Finance High-Speed Rail Intercity Rail

European Transport Agencies Consolidate Intercity Rail Operations in Face of Competition

» As Veolia closes in on Transdev, Deutsche Bahn completes acquisition of Arriva. All before much real competition has begun.

Compared to Western Europe, the U.S.’s intercity passenger rail system seems positively easy to understand, with exactly one major carrier. The Old Continent has a glut of operators providing services along thousands of miles of travel corridors, representing billions of rides every year. In Western Europe, with serious competition in play in the United Kingdom, Germany, and the Netherlands, this makes for a complex system of corporate link-ups and competing systems, as the chart above shows.

With European Union regulations promoting competition in international services across the continent beginning this year and in domestic services over the next few, the system will get a whole lot more complicated. That is likely to benefit most directly three major corporate entities: The German national rail company DB, the French national rail company SNCF, and private company Veolia Transport.

DB completed the acquisition of the Arriva Group last week, making a wholly-owned subsidiary of the British company that operates several rail franchises in the United Kingdom, Germany, and the Netherlands. Though the German businesses of Arriva will be divested as part of a deal with European regulators, this will give DB a major foothold in the U.K. to join with its already clear dominance in its home market.

Meanwhile, the merger of Veolia Transport and Transdev, both French companies, seems likely to create a similar powerhouse if the deal goes through as expected either in 2011 or early 2012. The merged group, representing almost €10 billion in annual revenues, is primarily involved in public transit operations, but it is advancing rapidly towards increasing its presence on the intercity rail market. Veolia announced late last year that it is working with Italian national rail operator Trenitalia to run high-speed trains into France.

SNCF has been expanding its international presence through its Keolis division, which already runs trains in Britain, Germany, and the Netherlands.

Each of these companies is either completely owned by a national government or has some government involvement in its organization. National European rail operators are relatively autonomous in their decision-making. Still, this could produce an interesting situation in the near future in which, for example, a division of the government of Germany could operate trains between destinations in France and the United Kingdom.

The dominance of these three players is likely to upset the current deals that allow high-speed trains to travel between European countries, since until recently the major national rail companies stuck to their own countries. In essence, E.U. regulations will allow any operator to use tracks in any of member countries as long as they pay the required track use fees and win a schedule slot. DB is planning to run its ICE trains through the Channel Tunnel, competing directly with primarily SNCF-controlled Eurostar; NTV, a new fast train company partly owned by SNCF, will compete with Trenitalia beginning later this year; through Keolis, SNCF has said it may run TGVs into Germany for the first time without agreement from DB.

The sheer size of companies like DB, SNCF, and Veolia increases their ability to bid for intercity rail operating contracts in countries across the continent. This seems likely to put into difficulty the existing national operators not only in the countries where competition is already accepted but also eventually in places like Spain, currently monopolized by national service Renfe.

Notes about the chart above: To simplify matters, I’ve only included the U.K., Ireland, France, Spain, Belgium, Luxembourg, Portugal, Germany, and Netherlands; Western Europe is larger than that, but there’s only so much to be shown on one chart. I also have included several deals that are not yet completed, included the Veolia-Transdev merger. In addition, some of the chains of control are simplified, excluding some subsidiaries sitting between corporate HQ and actual operations. Local public transit is not included here.

Amtrak DOT Freight High-Speed Rail Infrastructure Intercity Rail

U.S. Withdraws Proposed Freight Rail Regulations But Fails to Address Conflict with Future Passenger Service

» Freight companies rejoice now that they won’t have to pay for passenger train delays.

It was inevitable: Distraught by the possibility of having to increasingly open up their tracks to passenger trains, the freight railroad companies have staged an open rebellion against a proposed U.S. policy that would have penalized them if they caused delays.

The rule, which was proposed in May by the Federal Railroad Administration, would have enforced “stakeholder agreements” that went along with funding for new or improved intercity rail routes advanced by state governments. In exchange for a public investment in track, signaling, and the like, freight rail companies would be required to ensure that passenger trains aren’t delayed by oncoming traffic or slowed-down cargo trains.

In the Omaha World-Herald earlier this week, reporter Joe Ruff described some of the opposition to these rules. D.J. Mitchell of BNSF railways, suggested that the situation was stacked against the freight companies since their existing lines simply are not built for trains running at speeds higher than 90 mph whereas the Obama Administration has been adamant in pushing projects that increase maximum speeds to 110 mph along freight corridors. Meanwhile, Ruff quotes Bob Turner of Union Pacific, who argued not only that the passenger trains could delay freight traffic but also that “It’s out land, it’s our rails… This is about the government regulating what happens on our property.”

This was a sad reaction from an industry that could potentially benefit handsomely from the infusion of significant federal dollars. The freight railroads have operated mostly without government help for decades. Yet Washington clearly did not approach this situation with the necessary tact, failing to inform the industry of the proposed rules changes… before they were proposed, which evidently is the way things are supposed to work.

Joseph Szabo, head of the FRA, concluded that the rules were a mistake, and pulled the regulations out of consideration, a move veteran transportation insider Ken Orski dubbed as “sensible.” Orski concluded with a hope that Mr. Szabo “do no harm” to the freight industry, a message most people can agree with but one that provides little sense of what direction the government’s future initiatives need to point. But the decision also seems to suggest that the federal government is unwilling to mess with the freight industry no matter the costs. Is that an acceptable position for the future of the national transportation system in general?

The fundamental problem is that the U.S. government has failed to produce a guiding document that lays out the national goals for the railway system, both in terms of both freight and passenger movement. The national rail plan, whose preliminary draft was released last fall, is by all evidence likely to be a manifesto of vague, uncontroversial ideas, with few specific “plans” for the country’s future mobility. This means that the manner in which the DOT awards intercity rail grants — generally on a state-to-state basis, without much consideration of national needs — is likely to be the way it’s done over the next few years as well.

It also means, in more direct response to the issue posed here, that the government has failed to mediate a compromise between the proponents of freight and passenger rail service. The difficulties raised over the recent proposals by the FRA are only the start of things. For the future of American intercity rail, the government has a responsibility to take further steps to coordinate policy so that it benefits both sides of the rail equation, but it has not done so thus far.

As I discussed last month, despite the fact that allowing trains of different speeds (freight trains are slower than high-speed trains) would (and does) cause problems, there is significant ground for compromise that would allow both services to be improved substantially over the next few years. Notably, were the government to encourage joint use of tracks in city centers by rival freight companies, other inner-city corridors could be devoted to passenger rail without much of a problem.

But that won’t be possible unless the federal government abandons the hands-off policy it seems to be enforcing through its recent decision; at some point, if freight railroads benefit from national investments in their tracks, they should face penalties if they prioritize their trains over passenger vehicles. Freight companies may own the tracks, but if they’re getting funding for improvements, they have to compromise to allow passenger trains to operate effectively.

It’s time to develop a dialogue between freight railroad companies and advocates of improved passenger rail. Improvements for both don’t have to be set in opposition to one another.

Image above: C&NW freight train, by Flickr user vxla (cc)

Bay Area Bus Elections Light Rail Los Angeles Tampa

The Politics of Mode Choice

» Choice of transportation mode for new transit capital projects is often just as much a reflection of politics as it is a statement of “objective” technological benefits.

Would it be an indictment of the political system to suggest that most political leaders making decisions about what kind of technology to use in new transit corridors simply don’t care about the relative merits of various transportation modes? If someone were to develop a definitive formula that established, once and for all, the most appropriate technology for any possible corridor, would it matter?

I raise these questions because when put it in the context of actual decision-making by politicians in the United States, the seemingly endless debate between proponents of rail and buses can sometimes appear downright irrelevant.

Bus rapid transit may provide the same capacity as light rail or light rail may be more effective in producing ridership increases or busways may be cheaper to construct or trains may be better transit-oriented development generators. But if there isn’t significant political support for a transportation technology, it doesn’t matter; the only proposals that are built are those that capture the hearts of the people who decide how public funds are spent.

Last week Tampa Mayor Pam Iorio, her region’s biggest cheerleader for better transit, suggested that for new transportation routes, “Bus rapid transit is not acceptable.” The regional transportation agency HART has yet to determine whether it will promote light rail or faster buses for one of the many potential corridors for better transit service. But the Mayor’s statement, backed up by similar nods of approval for trains by HART President David Armijo, suggests that the only politically feasible option is light rail. When voters in the Tampa region go to the polls on November 2nd to determine whether to increase their sales taxes, they will be considering whether to fund rail, not just any sort of improved transit.

On the other hand, up in Maryland, Republican gubernatorial candidate and former Governor Robert Ehrlich Jr. has suggested that he would replace the current (Democratic) governor’s plans for light rail in Baltimore and suburban Washington, D.C. with bus rapid transit projects. Mr. Ehrlich has cited what he claims are the cheaper costs of bus investments, an opinion that may have more to do with reorienting transportation funding towards highways but which still could point towards efficiency in spending, important for any government program.

There are plenty of seemingly reasonable explanations for the rock-hard support of both Ms. Iorio and Mr. Ehrlich for their preferred transit technologies, but the fact is that their statements in favor of one mode or the other are based on emotional responses, not some kind of well thought-through assessment of their communities’ specific needs.

For many politicians in the United States, light rail has attained something of a mythical status, and they’ve been able to transfer the excitement about the mode to their constituents, as proven by the recent proliferation of successfully passed transit sales tax increases usually founded on the assumptions that trains are coming. There’s some good logic to this fact: Trains are sexy and different: For metropolitan areas used to only bus operations, light rail is appealing to the popular imagination in a way that bus rapid transit is simply not because of its similarity to existing services. Even if it is possible to imagine bus lines that are just as performing as light rail, it is hard to communicate that potential to the average person before a vote.

Los Angeles Mayor Antonio Villaraigosa’s successful campaign to advance the Measure R tax increase in 2008 and now his 30/10 transit plan, both of whose products will primarily be new rail lines, is arguably founded on both general enthusiasm for rail services in L.A. and the coinciding promise that the plan will bring those offerings to everywhere in the region. Similarly, the increase in local taxes to fund the extension of the San Francisco Bay Area’s BART rapid transit system into San Jose was endorsed by more than two-thirds of voters in the 2008 election cycle, likely because of the emotional appeal people in the area hold for the BART rail system. There are cheaper and arguably more appropriate alternatives, like a bus rapid transit line or an improvement of commuter rail services in the East Bay, but they weren’t considered because of a lack of political will to advance their development.

The fundamental question for proponents of better transit stuck asking themselves what transportation technology to support is this: Is it more important to argue for a mode that is more technically efficient or one that is emotionally appealing? Could Mayor Villaraigosa have found enough support for his plan had it promoted a series of busways? Is Mayor Iorio’s argument in favor of light rail a response to her recognition that only it will be exciting enough to appeal to voters?

More directly: If it is necessary to intrigue both politicians and the public about a new transit system in order to get it funded, the necessary corollary must sometimes be choosing the wrong transportation mode from a technical perspective in order to satisfy political demands.

All this said, I do not want to imply that the continued discussion about what transportation modes work best is a silly matter; if anything, more research is necessary to answer the questions that continue to enliven debates about the various benefits of different types of transit. If planners can demonstrate conclusively that light rail really does produce higher ridership and more transit-oriented development than bus rapid transit, then they have an obligation to push for its implementation. If, on the other hand, they can show that bus rapid transit can provide all the benefits of light rail at a lower price, then they must do the opposite.

But planners will only be able to make their argument effectively if they are able to frame it in terms that are appealing for the people who control the public’s purse strings, both in the voting booth and behind the mayor’s desk.

Atlanta Streetcar

For Now, Atlanta Opts to Promote Streetcar Starter Line Over Beltline

» Famed inner-city loop will have to wait on the sidelines as downtown streetcar competes for federal TIGER II funds.

Today is the deadline for applications to the second phase of the U.S. Department of Transportation’s TIGER program, which provides multi-million dollar grants to transportation projects around the nation based on merit. Cities are likely to submit several billion dollars of proposed projects to compete for a $600 million pot. Unlike the first round, in which Tucson, Detroit, and Dallas received funding for their streetcar lines without having to allocate local funds, this time municipalities are required to contribute 20% of the estimated cost of the program.

Atlanta has chosen to submit a 2.6-mile streetcar line for consideration this time. Of total estimated costs of $72 million, the city hopes the federal government will chip in $52 million; the city and the downtown development district have each agreed to pay $10 million. The rail link will serve as an east-west connector right downtown between the Centennial Olympic Park and the Martin Luther King, Jr. Center, mostly along Edgewood and Auburn Avenues east of downtown. With significant local funding, more than 2,000 estimated daily riders, and the potential to encourage transit-oriented development around Georgia State University and the historic Sweet Auburn, this project is well positioned to win a grant from the U.S. DOT.

Atlanta’s previous application for the first round of TIGER grants, a $300 million proposal to bring streetcars from downtown to Arts Center along Peachtree Street, was rejected due to its duplication of the existing MARTA rapid transit route and its lack of a local funding commitment.

Like many cities applying for similar transportation funds from the federal government, Atlanta has had to prioritize. In this city’s case, though, that prioritization comes to the detriment of one of the nation’s most innovative projects: The Beltline. Unlike the proposed streetcar, which in most ways mirrors similar programs across the country, the Beltline advances a different way of thinking about how to build transportation.

Indeed, if the so-called Capital of the New South does not get money from the TIGER II program, it will be thanks to the decision to find U.S. dollars for the Beltline later rather than now. This project has for the past several years at least appeared to be the city’s transportation priority. What happened? Are city council members suffering from a case of attention deficit disorder?

The Beltline — a $2.8 billion, 22-mile trail/light rail line/development engine — appears to fit perfectly the guidelines of the TIGER program, which is supposed to support innovative thinking about transportation investments. Will Atlanta being doing anything different if it spends on a streetcar?

On the other hand, the Beltline really is different than anything else proposed in a U.S. city. Using a series of mostly abandoned freight rail corridors extending in a loop around the city center, the program would produce an elongated necklace of parks, trails, and recreation facilities. Running on roughly the same corridor would be a transit system, likely light rail, providing circumferential movement between the MARTA branch lines.

The Beltline organization agreed not to submit its demand for $13 million in trail elements to the TIGER program in order to improve the city’s chances of winning money for the streetcar.

From one perspective, this was an admirable decision, since the streetcar is closer to being shovel-ready than the Beltline transit element, whose mode choice has not even been made yet. Just as important, since the Beltline is a much larger project than the streetcar it may be able to qualify for the federal government’s New Start major transit capital projects program in the future, once more study of transportation mode alternatives has been completed.

But the U.S. DOT sponsored trail programs in the previous TIGER grants; if this is what can be done for the Beltline now, that’s worth something since it helps begin the necessary future flow of U.S. money into the program. Is it unfair to point out that Atlanta hasn’t exactly been at the cutting edge of public transportation over the past two decades, and that it may have trouble advancing two new rail programs simultaneously? That’s especially concerning considering the city’s plans to extend the streetcar up Peachtree Street. Which does the city value more: The groundbreaking Beltline or the like-so-many-other-cities streetcar?

I may, however, be asking an unfair question. Georgia is advancing rapidly towards approving a measure that would allow Atlantans to vote themselves a regional one-cent sales tax specifically designed to pay for transit expansion projects. Of the $5 billion that could be raised over the next ten years, up to 60% could be earmarked for transit. That would make building both the streetcar and the Beltline perfectly possible.


Weekend Links

» This week’s big news. Open thread in the comments.

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On The Transport Politic:

A note on the last article: In discussing the matter of access between Chicago’s downtown and its airport, I neglected to mention two important issues about such links that generally apply to places throughout the country. One, that they’re too often proposed as elixirs (even “money-makers”) for struggling transportation agencies and thus that they are sometimes prioritized over more important projects; and two, that the City of Chicago would do well if it truly thought over the value of such a connection before it pushed its construction. The second is especially relevant considering the clear current federal emphasis on high-speed intercity projects. Last year, French national railroad company SNCF proposed a bypass loop around Chicago, running through the airport, as an essential element of its proposal for a Midwest high-speed rail project, but didn’t suggest a direct fast downtown-airport connection. Perhaps that should put in question what is the more important investment for the whole region.

New Directions for the Old South series on Next American City:

Fast Trains Aren’t Easy

For those hoping high-speed rail could be a non-partisan issue, this week likely served as an ugly wake-up call. In Wisconsin, which received hundreds of millions of dollars from the Obama Administration earlier this year, GOP gubernatorial candidate Scott Walker has been making a big deal about how he would return the money if he’s elected to office later this fall. This isn’t new news from Walker, who’s been fighting the project for months, but now he has created a special website designed to criticize the Milwaukee-Madison intercity rail project, which he’s opposing because it would require the state to chip in annual operating subsidies. He prefers investing in roads subsidies instead.

Over at the California High-Speed Rail Blog, Robert Cruickshank has detailed the push by Republican gubernatorial candidate Meg Whitman to delay funding for the high-speed rail project between Los Angeles and San Francisco. Her Democratic rival Jerry Brown supports a project speed-up, whatever that means.

Meanwhile, the Wall Street Journal suggests that the $8.5 billion in requests for funding the DOT received for a $2.3 billion pot earlier this month means that states are backing off from high-speed rail because of the now-required 20% local commitment. This, evidently, is too much for many states, especially those controlled by conservatives who are uninterested in putting up their own money.

Image above: Light rail at Denver’s Union Station, from Flickr user DanTheWebmaster (cc)